Issues And Objectives Of The Commercial Bank Of Ontario

2115 WordsJun 3, 20169 Pages
Issues & Objectives is as follows: As Jackie Patrick, loans officer for the Commercial Bank of Ontario, the key issue is whether or not I will accept or reject Mackay’s request for a bank loan and line of credit. My key objective is to develop a thorough understanding of the facts presented in the case in order to make an informed decision that will best serve the interest of the Commercial Bank of Ontario, myself as the newly appointed loans officer, and of course my client Mr. Mackay. As Mackay, the key issue(s) is, how will he continue to operate and pay off his outstanding debts in addition to, what will happen to Lawsons should the loan and line of credit not be approved? If approved how will he ensure (what plans are in place) that he will make good on his payments, both to the bank and FWL. As Mackay, the key objective(s) entail, securing a $194,000-bank loan in conjunction with a $26,000 line of credit in efforts to reduce his trade debt and service his tight months of cash shortage (Lawsons, 2013, p. 311) in order to avoid filing for bankruptcy and foreclose his business. 1. Ratio Analysis Liquidity Current ratio Current ratio is as follows: 2013 2012 2011 2010 Current ratio 1.02:1 1.55:1 2.06:1 2.97:1 Lawsons 2010 and 2011 current ratio are above the industry average (1.8:1) however in 2012 the current ratio falls below the industry average at 1.55:1 and than again in 2013 to 1.02:1. This indicates that the company’s ability to pay its debts is

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